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Passengers pick up latest bill for increase in cost of aviation fuel
Cathay Pacific and eight other airlines  have been cleared by the government to charge passengers more than HK$900 each way in fuel surcharges on long-haul flights.
More carriers are expected to apply for a higher tariff next week to help offset the rising cost of aviation fuel.
The higher surcharge means short-haul passengers flying within Asia will pay HK$231 each way, up 35 per cent from  HK$171. Long-haul routes to destinations such as North and South America, Europe, Africa and the Middle East will now cost HK$924 in fuel surcharges instead of HK$710, up 30 per cent.
These are the maximum adjustments allowed by the Civil Aviation Department (CAD) under the current review, effective from August 1 to September 30.
Cathay Pacific, which expressed regret over the higher surcharge, said the latest increase would  cover less than half  the  fuel cost.
The current average short- and long-haul fuel surcharges represent 50.4 per cent and 63.4 per cent of those at international levels, respectively.
Cathay Pacific, its subsidiary, Dragonair, Singapore Airlines and short-haul  Xiamen Airlines will impose the maximum increases. Nepal Airlines  and Saudi Arabian Airlines,  which previously opted to maintain their surcharges at HK$240 and HK$118 per leg, respectively, will more than double them to HK$540 and HK$470.
All Nippon Airways' surcharge  will rise to HK$171 from HK$125, Jetstar Asia Airways will raise its surcharge to HK$231 from HK$136, and the new Aeroflot  rate will be HK$753, up from HK$620.
A department spokesman said: 'Despite the reduction in oil prices in the last several days, the latest monthly average for aviation fuel prices is still higher than that when the passenger fuel surcharges were last reviewed.
'The significant increase in fuel prices has had a severe impact on the operating costs of airlines.
'Although airlines have taken some cost-cutting actions to counter the high fuel costs, they are still  unable to offset the additional cost due to the high fuel prices. Some airlines have had to redeploy their capacity or even reduce services.'
Data from the International Air Transport Association, which represents the airline industry, shows the average global  price of aviation fuel   reached US$166.10 a barrel on July 18. This was down 7.1 per cent from a week earlier, but 81.7 per cent higher year on year.
The association estimated that  would raise  the global airline industry's fuel bill this year by about US$89 billion.
A Cathay Pacific spokesman said: 'There is a significant time lag of two to three months from the time we submit our fuel surcharge application to the CAD to the time the new surcharges become effective.
'The supporting information we submitted earlier this month to the CAD was based on average jet fuel prices in May and June since the last review.
'Also, the difference between jet fuel and crude oil prices had widened dramatically in recent months because of additional refinery costs, limited refinery capacity and persistent demand.'
Rising oil prices have taken a heavy toll on the region's aviation  industry this year. Cathay Pacific said this month that half-year earnings scheduled to be released next month would be  disappointing.
Sky's the limit
Cathay Pacific, Dragonair and
Singapore Airlines
are among nine
airlines that will be allowed to raise
their fuel surcharges
The cost of HK$171 for a  one-way short-haul flight  will increase, in HK dollars, to $231
For a long-haul flight, the cost   of HK$710 will rise to  $924



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Cathay Pacific

Nine airlines cleared to raise fuel surcharges

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